A profound suspicion of narrative form is widespread in trauma studies. Not only is trauma seen as de facto inassimilable to narrative understanding, but also stories as such are frequently considered to be ethically problematic in their very attempt to make sense of traumatic experience, because the act of narration is taken to reduce something singular into an account that gives it a general meaning. This paper suggests that such a position largely depends on a subsumptive model of understanding, which underlies, for example, much of poststructuralist criticism of the violence of understanding. This paper explores an alternative, more hermeneutically oriented approach which may make it possible to rethink the ethical potential of storytelling. The paper also discusses how the current suspicion of narrativity echoes the crisis of storytelling in postwar Europe, when a new generation of novelists (such as the nouveaux romanciers) felt that storytelling is inadequate in responding to the traumatic experience of the Second World War. Contemporary literature, in turn, may help us acknowledge not only the violent dimension but also the ethical potential of narrative. In the light of Julia Franck’s Die Mittagsfrau (2007, The Blind Side of the Heart), the paper analyses, in the post-Holocaust context, the way in which nothing in stories guarantees the actualization of their ethical potential and the way in which narrative identities imposed on us may lead us to repeat harmful emotional and behavioral patterns. The paper examines how seeing storytelling as a process of reinterpreting experience may allow us not only to acknowledge the temporal, inevitably unfinished character of storytelling, and its implications for confronting collective and personal trauma, but also to analyse when narratives enlarge the space of possibilities in which we can act,think and re-imagine the world together with others, and when they restrain or impoverish the possibilities open to us, reinforcing painful repetition of traumatic experience.